The Role of Institutions in State Development
The Importance of Institutions and their Role in State Development The previous articles in this module have briefly discussed the importance of institutions in state building and state formation. The key themes that were introduced were how well functioning and stable institutions contribute to state development and state formation. When we talk about institutions, we […]
Why is Market Risk Management Important?
The concept of market risk has always been around ever since financial markets have existed. However, the measurement and management of market risk is fairly new and has come up only in the last three to four decades. The recent past has seen a proliferation of theories and models which have been used to measure […]
Introduction to Group Behavior in Organizations
Introduction Humans are social animals and hence, form groups wherever they are. This is true for organizations as well as familial and friendship networks wherein people tend to congregate in groups and be governed by the norms and rules of the group. For instance, familial groups impose a certain way of behavior in us as […]
Effective Writing for Results
While writing to a friend, colleague, client, or a business partner, the content must be clear, concise, persuasive, accurate, and confident. Read on to know some tips for making the letter/memo/presentation worthwhile. Avoid being verbose: Choose shorter words and sentences. For e.g. “I wanted to bring to your notice that the meeting has been cancelled”. […]
Commonly Used Measures of Risk
The discipline of risk management has been evolving through the years. As a result, the process of measuring risk and assigning numerical values to them has also been evolving over the years. The earlier measures of risk were simplistic and rudimentary in nature. With the passage of time, quants have started getting increasingly involved in […]
The very word bureaucracy conjures images of sloth, inefficiency and status quoist mindset. To associate bureaucracy with change would thus be looked as an oxymoron. However, it is the case that some large organizations that were otherwise bureaucratic in their organizational structures managed to bring about change in the way they worked.
The best known example of this is the exemplary leadership provided by Lee Iacocca in his time at Ford and Chrysler, the auto majors in the United States.
For the current generation, Lee Iacocca might be relatively unknown. But, for those who remember his extraordinary contributions to these organizations are aware of the way in which he turned them around in the face of stiff opposition from the bureaucracy.
The book, Iacocca (an autobiography written by him) is a must read for those who want to implement change in large organizations.
If we look at the cases of large organizations where change did not succeed, we need not look farther than the governmental bureaucracies in all countries (especially India) where change is the farthest thing in the minds of the bureaucrats.
To give an example of a private sector organization that could not drive through change because of bureaucracy, we find General Motors and HP among the leading contenders. In both cases, the entrenched mindset which resisted any kind of change stymied the efforts of the leadership as well as those who wanted to bring about reform in these organizations.
So, what is it that makes some organizations better able to reform their bureaucracies and others fail to do so? For starters, the organizational structure is the key to implementing change management and the way in which it is designed is often the differentiating factor between success and failure.
The arteries of the bureaucratic organizations tend to get clogged with time leading to institutional resistance to change; next, the way in which the business imperatives are defined is crucial to making the employees buy into the change initiative.
For instance, if the employees feel that change is being driven because of the personalities of the leaders and not necessarily because of the need to make more profits or respond to competition better is a major put off when change initiatives are launched.
So, the bottom line is that the structure as well as the people making up of the parts of the organization needs to be changed first if lasting and permanent change is to be achieved in the organization.
Finally, the way in which change is communicated internally to the employees makes a lot of difference in the way the change program is implemented and determines the success or otherwise of the initiative.
The top leadership must be honest and truthful in their communication to the employees as far as telling them about the business drivers for change.
In most cases, top leadership talks about change as though it is their pet project driven solely by ego and personal interests. Only when employees believe that the change program is needed because of valid and relevant business factors can there be an acceptance and buy in of the initiative.
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